Get The Facts

economistAir Passenger Duty (APD) is the UK Government tax that is charged on all passengers departing from a UK airport. Some things you might not know about APD:

  • Introduced in 1994, it was originally just £5 per person for short-haul flights, and £10 elsewhere.
  • Successive governments have increased APD, so that passengers now pay up to £73 on long-haul flights.
  • PwC has published research which found that significantly reducing or abolishing APD would result in a significant increase in the UK’s Gross Domestic Productand the creation of tens of thousands of new jobs. It also found that reducing or abolishing APD would actually increase the revenues to the Treasury from other taxes so much that it would pay for itself – increasing the amount money flowing into the Exchequer.
  • The vast majority of European countries do not levy an air departure tax.
  • Since it was introduced in the 1993 Budget, the cost of Air Passenger Duty per flight has risen by up to 539%.
  • The UK is ranked 137th out of 138 when it comes to air ticket taxes and charges according to the 2015 World Economic Forum’s Travel and Tourism Competitiveness Report. Only Chad ranks lower than the UK.
  • A report by the Centre for Economics and Business Research shows the annual contribution to the UK economy of the leisure aviation industry is £14.1bn.

Scotland and Air Passenger Duty

  • Following the Smith Commission’s report (2014), the Scottish Government has announced plans to reduce APD on flights leaving Scottish airports by 50%.
  • A Fair Tax on Flying welcome the Scottish Government’s recognition that APD is an uncompetitive and damaging tax.
  • However, Government modelling has shown that any reduction of APD in Scotland would have a detrimental impact on airports and other travel businesses in other parts of the UK, and distort the highly competitive aviation and tourism marketplace.
  • We therefore urge the UK Government to act before disparate APD rates affect the economy of the UK as a whole. A cut in APD in Scotland should be matched by the same cut across the rest of the UK, so that no part of the country is disadvantaged in any way.